In the run up to the general election, Aam Aadmi Party had alleged that RIL's partner Niko Resources was selling KG-D6 gas in Bangladesh for half the $4.2 per million British thermal unit rate that India pays them.
He added every dollar rise in the gas price will result in Rs 4,000 crore of revenue and Rs 2,300 crore in profit after tax.
ONGC and RIL bill their consumers like fertiliser plants and power stations in US dollar.
Iran has changed its pricing formulae for liquefied natural gas sale to India and is demanding 28 cents more per million British thermal unit (mBtu).
A close examination of the government's decision-making process shows there were four specific reasons that influenced the Union Cabinet's Wednesday move to defer a decision on gas prices by three months, to September 30.
Iran has sought a 20 per cent increase in price for the additional 2.5 million tonnes per annum of liquefied natural gas that India wants to buy, over and above the five million tonnes contracted earlier this week.
RIL has more than half a dozen undeveloped discoveries.
A third of the 1.2 billion Indian population has no access to electricity.
The government recently announced a new formula for determining the price of natural gas, lowering it from $8.4 suggested by the C Rangarajan committee.
As per the 15-day billing cycle, gas producers are to raise the first invoice at the revised price of $5.61 per million British thermal unit this weekend.
Mukesh Ambani's Reliance Industries (RIL) might be denied a higher gas price from its D1 and D3 fields until the arbitration process with the government is over and a third-party expert report on the fall in output at the KG-D6 block is out.
A swift recovery in oil demand in India is not only helping the stability of the global market, it is giving huge fiscal headroom to the government in terms of additional excise duty.
Among the documents that Arvind Kejriwal handed out in his press conference on Wednesday, was a page from the letter from the former minister of petroleum and natural gas, S Jaipal Reddy, and marked as annexure 5, to Reliance Industries about its KG Basin oil extraction
Reliance Industries looks set to get higher price for its KG-D6 gas from April 2014 after the Prime Minister's Office has ordered that the firm be allowed to discover the market price as stipulated in the contract.
Reliance Industries has sought tripling of its KG-D6 gas price from April 1, 2014 after the current below market rate of USD 4.205 per mmBtu expires.
RIL has proposed to charge the government- fixed rate for natural gas on a gross calorific value (GCV) basis, instead of net calorific value (NCV).
Reliance Industries is facing penalty for falling gas output from its KG-D6 fields.
State-owned Oil and Natural Gas Corp (ONGC) will add about Rs 8,000 crore (Rs 80 billion) to its profits annually from near doubling of natural gas prices from next fiscal.
Majority of PLL's long-term deals are linked to crude, which faces price challenge from other fuels. Spot LNG is moving away from this linkage, which puts a question mark on crude linked contracts.
A four-member panel of secretaries is likely to submit its report on a new gas pricing mechanism to the government by Wednesday.
With domestic production of just over 140 million standard cubic meters per day meeting barely half the demand, India is importing 10 million tons of liquefied natural gas per annum and is looking at unconventional sources like shale gas.
Oil regulator PNGRB on Monday approved the tariff that Mukesh Ambani-owned East-West pipeline will charge for transporting gas from Reliance Industries' eastern offshore KG-D6 fields to users.
During hearing of the dispute over supply of gas by RIL to RNRL at $2.34 per mmBtu, the bench headed by chief justice K G Balakrishnan said the two parties could arrive at a 'suitable arrangement' through arbitration, as the Bombay high court that approved the Reliance empire's demerger cannot spell what is the ideal arrangement.
RIL declined to comment on this or related allegations, saying the entire issue was in court.
The power tariff will rise by Re 1 a unit due to hike in gas prices, Sushil Kumar Shinde, Union Minister of Power said.
Anil Ambani's Reliance Natural Resources continued its attack on the government for allegedly favouring brother Mukesh Ambani's Reliance Industries Ltd on the sale price of gas from the Krishna Godavari D6 basin. At $4.2 per million British thermal unit (mBtu), the price fixed, there is a premium of more than 100 per cent over the gas available through the administered pricing mechanism, it said.
The government plans to more than double the price of natural gas produced by Oil and Natural Gas Corp (ONGC) to $4.20 per mmBtu, in a move that will help the state-run firm break even in gas business.
The government may subsidise costly imported gas by making users of cheaper domestic gas pay more under its unique plan to rationalise gas prices, a source in knowledge of the development said.
With the Mukesh Ambani-promoted Reliance Industries Ltd (RIL) planning to approach the Supreme Court, challenging a High Court order for selling gas at $2.34 per million British thermal unit (mBtu) to Reliance Natural Resources Ltd (RNRL), the chances of an agreement between the Ambani brothers by July 15 appear remote.
The government has appointed Spanish speciality consultancy firm, Mercados Energy Markets International, to examine possibility of a uniform domestic price of natural gas, which is now sold at rates ranging from $1 to $5.73 per mmBtu depending on source.
If approved, gas price will rise to $6.775 per million British thermal unit from $4.2 currently.
In a surprise move, oil regulator DGH has asked Reliance Industries to include the marketing margin the company charges on sale of natural gas from its field to the approved gas price for calculating the government's share from the project.
The government may in 'weeks' decide on raising price of natural gas produced by state-owned ONGC and Oil India by 30 per cent, petroleum secretary S Sundareshan said on Monday.
Replying to a calling-attention motion in Rajya Sabha, oil minister Murli Deora said the $4.2 per million British thermal unit price fixed for gas produced from KG-D6 fields of RIL was lower than the average of $5.51 per mmBtu charged by UK's BG-led consortium for Panna/Mukta and Tapti gas. It was also lower than the $4.3 per mmBtu price of gas produced from Cairn's Ravva Satellite fields and $4.75 per mmBtu for the UK firm's Lakshmi fields.
The high court is hearing a dispute between Mukesh Ambani-led Reliance Industries and Anil Ambani's Reliance Natural Resources over a gas sale agreement, in which the government has intervened. NTPC has filed a separate suit against RIL, seeking that RIL execute the contract of gas supply.
State power utility NTPC Ltd will not lose any money even if it was to get natural gas at prices higher than those committed by Reliance Industries five years ago, the Power Ministry has told the committee on public undertakings.
Anil Ambani-promoted Reliance Natural Resources has filed an affidavit in the Bombay High Court in the case involving Reliance Industries, refuting the petroleum ministry's stand that the government-approved price of $4.2/million metric British thermal unit (mmBtu) is the selling price of gas.
The quantities and price of $4.2 per mmBtu for gas under the GSPAs signed for five years are as approved by the government.
India cannot afford to let lower natural gas price of $2.34 per mmBtu prevail as the rate will hinder development of a natural gas industry in the country, US-based Bernstein Research said in a latest report.
On July 27, power ministry had written to the oil ministry saying 'the marketing margin being charged by RIL is not in line with the decisions of an empowered group of ministers on pricing formula (for KG-D6 gas)'. While Anil Ambani Group firm RNRL on Sunday alleged that RIL was charging 'unauthorised' marketing margin, 35 firms buying KG-D6 gas are paying the $0.135 per mmBtu to RIL without protest.
© 2026 Rediff.com - Advertise with us - Disclaimer - Privacy Policy - Sitemap - Feedback - About us - Terms of use - Grievances